McDougal trial takes a soap opera turn

By Lynda Nikula/CNN

Susan McDougal

SANTA MONICA, Calif. (Sept. 9) -- The trial of Whitewater figure Susan McDougal, accused of embezzling $150,000 from conductor Zubin Mehta and his wife Nancy, will apparently become more like a soap opera story than a case about bookkeeping shenanigans.

The judge decided Wednesday that defense lawyer Mark Geragos could argue
that Nancy Mehta encouraged McDougal to spend the money she allegedly embezzled so that Zubin Mehta could not use the money to support several children he fathered outside of his marriage to her.

After the judge announced his decision Wednesday morning, Geragos resumed his opening statement which had been interrupted Tuesday afternoon when the prosecution objected to his references to Zubin Mehta's illegitimate offspring.

Geragos contends that Nancy Mehta launched her own spending spree and encouraged McDougal to do the same to exhaust her husband's bank account because she expected her husband to divorce her and give the money to the children.

He said Nancy Mehta later accused McDougal of embezzlement because she was angry that McDougal quit as the couple's bookkeeper.

Prosecutor Jeff Semow, in his opening statement Tuesday, said McDougal's
embezzling from the Mehtas was "like taking candy from a baby" because the
husband had no interest in the management of his finances and his wife lacked
the understanding in financial matters.

Zubin Mehta

Before working for the Mehtas, McDougal lived a luxurious lifestyle in Arkansas, but could not maintain the high level of living after moving to California in 1987, he said. She was left without supervision after bookkeeper Kate Bell was fired at the end of 1990, Semow said.

After the Mehtas returned to California from a long trip to Italy in 1992, they were told by their lawyer that McDougal and another employee signed Nancy Mehta's name to checks, the prosecutor said.

They also learned that McDougal was using a Bank of America Mastercard
that had been issued in Nancy Mehta's name, but with McDougal listed as a
co-holder, Semow said.

He showed copies of credit card receipts signed by McDougal for purchases
such as children's clothing, mens clothing, and lunches. Accounting entries
said it was for housewares, furniture and fixtures for the Mehta's home.

Semow said the checks written to pay for the Bank of America charges were
forged. He also accused McDougal of laundering money through another Mehta
employee.

McDougal met the Mehtas through Pat Harris, who was initially hired to
manage rental properties for the Mehtas. McDougal is now engaged to Harris.